|
Euro Hits Record High Versus Dollar
The euro hit a record high against the dollar at $1.1899 on Tuesday, climbing above the previous record of $1.1886 set on one major trading system on the day of its launch in January 1999, Tokyo traders said. "The euro is keeping its bullish tone from yesterday, especially after the strong Ifo figures," said a dealer at a major Japanese bank.Back to where it was on day one. "But London was on holiday when they were released so I think the market is still trying to catch up," he added. Data released on Monday showed the key German Ifo business climate index rose to 87.6 in May from April's 86.6, beating most analysts' forecasts. Many dealers believe it is only a matter of time before the euro hits the next target of $1.20 now that it has gone above the psychologically important launch-day high. There has been some confusion over the single currency's record with different data providers registering different all-time highs. Traders said electronic broker EBS had registered $1.1886 as the high whereas on Reuters data the peak is $1.1906. Despite the possibility of a near-term pull-back, currency analysts at some major banks have revised up their forecasts for the euro in recent weeks. Some now argue that the attention attracted by the euro's recapture of its launch level and the push to record highs will reinforce its potential to climb. Global portfolio managers may make more allocation shifts into euros as a result of its recent gains, while long term investors including pension funds and insurers are likely to look more favorably on the single European currency, strategists say. In addition central banks — a centrifugal force in foreign exchange markets — may steadily increase euro weightings in foreign exchange reserves. Such shifts could push the euro into a sustained ascent for months, if not years to come, according to some analysts. Posted by: Steve White 2003-05-27 |
| http://www.rantburg.com/poparticle.php?ID=14757 |